The whole story of Elon Musk acquiring a 9.2% stake in Twitter, being offered a seat on the board on the back of that acquisition, then the nature of his own rejection of that offer, and his subsequent outright purchase, is enough in itself to hit the front pages. But scratch the surface, and only a very light scratch is required, and more questions are posed than answers given.
What’s in it for Musk? He’s a keen user of the platform, but the reasons why such a rich person - Forbes estimates his personal wealth to be an eye-watering $278 billion – needs such a toy to buy are not clear.
Musk is clearly a dreamer. But not the kind of hippy-dippy, head-in-the-clouds, too-much-money dreamer.
He has wanted to be creative, innovative and technical since childhood, taking on his father’s engineering DNA and taking it to the next level. The next few levels.
Elon Reeve Musk was born in Pretoria, South Africa on June 28th 1971 into a wealthy family, with his father being an electromechanical engineer, and his mother a model and dietician.
After an unhappy childhood he spent living with his father – a man he came to despise – Musk moved first from Ontario, in his mother’s native Canada, eventually to the University of Pennsylvania, where he graduated in 1995 with a Bachelor of Arts degree in economics and a Bachelor of Science degree in physics.
He has since been married twice, and has eight children.
In 1995, Elon, with his younger brother Kimbal, and friend Greg Kouri founded web software company Zip2 with start-up funds from angel investors. They based themselves in a small rented office in Palo Alto, California where Musk had moved to after graduating. The company developed and marketed an internet city guide for the newspaper publishing industry, with maps and directions.
When Compaq acquired Zip2 in 1999, Elon Musk’s share of $22 million was invested into his next venture – X.com – an online financial services and email payment company. It merged later with Confinity and eventually became PayPal. This was acquired by eBay in 2002, and Musk trousered a day-brightening $175.8 million.
In 2001, Musk got involved with the non-for-profit Mars Society, rekindling his love for space exploration. After trying – and failing – to acquire some de-commissioned inter-continental ballistic missile casings for his civilian space projects, he founded Space Exploration Technologies Corp, trading as SpaceX in 2002. Investing $100 million of his own money, he chose to build cheaper rockets than the Russians were selling. As of 2022, he is still CEO and ‘chief engineer’.
In February 2004, he invested in the fledgling Tesla Inc., eventually becoming its CEO in 2008. Tesla first built an electric sports car, the Roadster, in 2008. With sales of about 2,500 vehicles, it was the first serial production, all-electric car to use lithium-ion cells.
He also is largely responsible for the launch of the Tesla electric vehicle. Since 2010, the company’s stock has risen significantly; it became the world’s most valuable carmaker in summer 2020. In October 2021 it reached a market capitalisation of $1 trillion, only the sixth company to do so in US history.
He spends a huge amount of his personal and professional run-time at SpaceX, his own off-world exploration venture. His concern for the future of the human race is well-documented, to the point he is looking to build a permanent inhabited base on the moon. Or Mars.
Elon Musk’s feedback loop, which has been extremely valuable for Tesla, is now getting corrupted by his own superfans. Mostly taking place on social media, they take it upon themselves to treat any criticisms of any of his projects personally. The swarm mentality will round on the critic – playing the man instead of the ball – rather than stop to consider any merit in the criticism.
Musk has hitherto been receptive to valid criticism, but with projects now coming more and more on line, and risk becoming ever higher, he appears to be siding with his disciples.
His attitude to business, or at least, to business rules appear cavalier at times. In November last year, he proposed selling 10% of his shares in Tesla, something he finally did for small-nation GDP sum of $16.9 billion. This stunt placed him under almost immediate investigation by the US Securities and Exchange Commission (SEC) – the independent finance agency created in the aftermath of the Wall Street Crash nearly a century ago – for insider trading.
In 2016, Tesla, under Musk’s leadership, acquired SolarCity – at the time, one of the largest solar energy systems producers in the US – for $2 billion. The main problem was that he didn’t inform the shareholders first. SolarCity had liquidity issues, something else Musk knew but didn’t inform Tesla’s shareholders of. As a consequence Musk and the Tesla board were sued by its shareholders.
These are not the only times Musk has fallen foul of SEC investigations. He and Tesla were fined $20 million each in 2018 for a Tweet claiming funding had been provided to take Tesla back into private hands; an allegation the SEC sued Musk over claiming it was false, misleading and damaging to investors.
Musk is also a keen advocate of artificial intelligence, such as that phrase has any meaning at this stage of technological advances.
At a live demonstration in August 2020, Musk described Neuralink’s – one of his companies – early research and development devices as “a Fitbit in your skull” that could soon cure paralysis, deafness, blindness, and other disabilities. Many neuroscientists and publications rounded on these claims; the highly influential MIT Technology Review described them as “highly speculative” and “neuroscience theatre”.
BACK AT TWITTER
At first glance, the investment into Twitter doesn’t look to be the smartest business move. The headline figure
was that Twitter lost $221 million in 2021. While many of its figures of usage and new members was seen as being in line with market expectations, the loss Twitter reported is tied to a one-time net charge of $766 million from a lawsuit settlement. Twitter has said it would pay $809.5 million to settle a consolidated class-action lawsuit alleging that the company misled investors about how much its user base was growing and how much users interacted with its platform.
If Musk wanted to make a statement, any public utterances he makes through his own regular channels are reported, leaped on, scrutinised and hauled over for nuance, double-meaning or… anything other than a straightforward statement. So Twitter isn’t necessarily the most efficient use of his time.
Is he after a monopoly on social media? It’s not obvious he does. For one, he shows no inclination, so far, towards other platforms, and secondly, he has acquired just 9.2% of Twitter. Admittedly this is four time more than the founder Jack Dorsey currently holds, but after a promise not to acquire more than 14.5% of the company, his influence will be great, but not necessarily all-encompassing.
Is he looking to promote his own version of ‘free speech’? This question is looking as though it might get closer to what’s going on. Musk has entered the public debate on the notion of free speech, looking to make his own pitch for where he feels the rest of society should head on this subject.
And this is where we start to get into murky, sinister territory. On March 26th, Musk tweeted, “Given that Twitter serves as the de facto public town square, failing to adhere to free speech principles fundamentally undermines democracy. What do you think?” An entire pitch wrapped up in one short conversation starter.
That tweet in itself raises further ‘free speech’ credential issues. Firstly, and the timing of the tweet is key here; as a shareholder – albeit brand new to the company – Musk isn’t asking an open-ended question. It’s a political statement with an invitation to comment or, more likely, to agree.
Secondly, what does Musk mean by ‘free speech’? Whose version of ‘free speech’ is he talking about here? The one where anyone should be allowed top say anything, regardless of the consequences? Maybe the form of ‘free speech’ which only exists within the confines of anything said must come with its own form of personal and social responsibility? Or perhaps a third way of ‘free speech’ which only ever agrees with the Establishment? Or the status quo?
Even if anyone can unpick that bewildering bowl of moral spaghetti, an even bigger question arises. Who is Elon Musk to set the agenda here? Sure, he’s a rich man. He’s a clever man. He’s a successful man. But any form of public influence, once a given social tipping point is reached, must always come with a sense of accountability.
So with that in mind – Elon Musk setting the agenda for ‘free speech’? Says whom?
It’s the same for so much of society, where free market thinkers believe the market knows best. Others feel that all of society’s decisions should be made be elected decision-makers only. The more popular way is that society’s ever evolving rules will ultimately set the tone for what is appropriate within ‘freedom of speech’. The reality is somewhere in between, though politics (with a large ‘P’), certainly in this country, has yet to catch up on this notion.
The person, company or committee that’s in charge of a given aspect of our lives isn’t the central issue, it’s the level of accountability which ought to be setting the framework. Some things are just too big for one person, irrespective of how they’ve convinced themselves that money has bought them the intelligence and wisdom to sit in judgement of our lives.
Fast forward a few days, and the Twitter board and Elon Musk, having had several discussions, decided that Musk will NOT be joining the board after all. This appears to be Musk’s decision, but somewhat enigmatically, the CEO Prag Agrawal’s communiqué on the matter stated that Musk’s decline of an invitation was ‘for the best’.
This set eyebrows on a bungee-jump as, at one moment, the Twitter board appeared to be extremely keen to have Musk on board, followed by a statement that, in the light of Musk not wishing to join was a better idea.
Agrawal went on to say that ‘there will be distractions ahead but our goals and priorities remain unchanged. Let’s tune out the noise.’ What distractions? What noise? Elon Musk acquiring shares and being invited on to the board is clearly news; Musk’s rejection of that invite is arguably bigger news, but it doesn’t get to the nub of what’s going on. Evidently, Twitter and Musk do not necessarily share the same business values – if not social values – as one another. The next step will be interesting to observe.
IN OTHER NEWS
SpaceX began development of the Starlink constellation of low Earth orbit satellites in 2015 to provide satellite internet access. To date, over 2,000 satellites are functioning, providing linkage for 29 countries. The total cost of the project to design, build, and deploy the constellation is estimated by SpaceX to be about $10 billion
After the Russian invasion of Ukraine earlier this year, Musk facilitated sending Starlink systems purchased by other European nations and private funding to Ukraine for internet access and communication in the besieged country. Ukrainian president Volodymyr Zelenskyy thanked Musk for this gesture, and announced further talks between the two about space projects to take place after the war.
So what is society as a whole to make of Musk’s largesse? He is an entire menu’s worth of social, entrepreneurial and cerebral contradictions. He has a painfully thin hide when it comes to criticism, but will stand up in the face of tyranny for the small guy. He is concerned for the environment, but has no problem jetting off somewhere at a moment’s notice. He seeks betterment for the future of mankind, but so little of his enterprise goes on helping the poor, the sick and starving right now.
With all these inconsistencies, possibly brought about by his self-acknowledgement of having Asperger’s Syndrome, perhaps elevating yourself as a free speech champion, at whatever the price, may need a little more reflection and contemplation, and a little less narcissism.
The Twitter board and its shareholders have rolled over to have their collective tummies tickled, and accepted Musk’s takeover offer of £34.5 billion.
The impending coronation of Musk - a ‘free speech absolutist’ – at the top of Twitter will be of great concern to many social media users. For example, one of his pre-conditions was to re-instate the psychedelic musings of President Donald Trump back onto Twitter.
The EU, UK and USA are making noises to stamp down on the Wild West behaviour of social media companies, who at present turn a mostly blind eye to bullying, threats, misogyny, racism, homophobia and more besides.
Musk, who will want an even more open, unvetted, irresponsible social media forum, is going to put himself on a collision course with governments and institutions around the world. In the rarified atmosphere of mega-corporate silly buggers, the lawyers will be forming orderly queues around the block from their nearest Lamborghini showroom.
At least one thing has been made known now. What price global freedom of speech with no responsibility or consequence? The answer is $46.5bn, it would seem.